Del G:1. [ Unofficial translation. Translation is updated with amendments of 20 June, Offisiell norsk versjon: Lov av 13. juni 1997 nr.

Transcription

1 Public Limited Liability Companies Act Del G:1 Act of 13 June 1997 No. 45 Del G:1 Norwegian Public Limited Liability Companies Act. [ Unofficial translation. Translation is updated with amendments of 20 June, Offisiell norsk versjon: Lov av 13. juni 1997 nr. 45 ] * * * Publisher's comment: This unofficial translation of the Norwegian Public Limited Liability Companies Act is entirely in the ownership of Schjødt, with all copyrights attached thereto. Reproduction may take place only by consent from Schjødt. The Public Limited Liability Companies Act was effective from 1 January The present translation is updated to reflect all amendments effective as of 1 July We cannot guarantee the absence of translation errors or imperfections. Legal authenticity remains with the official Norwegian version as published in "Norsk Lovtidend", as amended. * * * Chapter 1. Introductory provision I. Scope of the Act. Limited liability 1-1. Scope of the Act (1) This Act applies to public limited liability companies. (2) A public limited liability company is any company 1. where none of the members have personal liability for the obligations of the company, undivided or for parts which altogether make up the company s total obligations, and 2. which is designated a public limited liability company in its articles of association, and 3. which is registered as a public limited liability company in the Register of Business Enterprises. (3) The King issues regulations on the application of the Act in Svalbard and may issue special rules having regard to any local circumstances Limited liability (1) The shareholders are not liable to the creditors for the obligations of the company. (2) The shareholders are not obliged to make any payment to the company or to the company s bankruptcy estate except as provided in the share subscription documents. II. Definitions 1-3. Company groups (1) A parent company constitutes, together with a subsidiary or subsidiaries, a company group. (2) A public limited liability company is a parent company if it, owing to agreement or as owner of shares or partnership interests, has determinative influence over another company. A public limited liability company shall always be deemed to have determinative influence if the company: 1. owns so many shares or parts in another company that they represent a majority of the votes in such other company or; 2. has the right to elect or remove a majority of the members of the board of directors of such other company. E (3) A company which is related as mentioned in the preceding paragraph to a parent company is deemed N to be a subsidiary. G (4) In calculating the voting rights and rights to elect or remove members of the board of directors, the L rights of the parent company and that of its subsidiaries shall be included. The same applies to anyone acting in I his own name but on account of the parent company or a subsidiary. S H 445

2 1-4. Companies that are equivalent to group companies (1) The following rules regarding parent companies apply also when the parent company is a private limited liability company: 3-8, 6-5, 6-16 (1), 6-16a (1) third sentence no (5), 8-5, 8-7 through 8-10 and 9-8. (2) The following rules regarding subsidiary companies apply also to a subsidiary with a foreign parent company: 3-8, 4-25, 6-16 (1), 6-16a (1) third sentence no. 3, 8-7 (1) and (2), 8-8 through 8-10, 9-1 (1) and 9-8. The rules in 4-25 and 6-16 are not applicable to foreign subsidiaries Related parties (1) For the purpose of this Act, related parties shall be interpreted to include: 1. spouses or persons who cohabit in a quasi matrimonial relationship; 2. relatives in direct line of ascent or descent and siblings; 3. relatives in direct line of ascent or descent and siblings of persons as mentioned under this first paragraph no. 1; 4. the spouse of, or a person cohabiting in a quasi matrimonial relationship with, any person as mentioned under this first paragraph no. 2; 5. Company where a person or a party as mentioned in no. 1 through 4, has such determining influence as mentioned in 1-3. (2) For the purposes of this Act, personally related parties shall be interpreted to include: 1. spouses or persons who cohabit in a quasi matrimonial relationship; 2. minor children of the person concerned, and minor children of a person as mentioned under this second paragraph no. 1 above with whom such person cohabits; 3. a company in which the person concerned or anyone mentioned in no. 1 and 2, has such determining influence as mentioned in 1-3. Chapter 2. Formation of a public limited liability company I. Documents of Formation. Share subscription 2-1. Memorandum of Association (1) In order to form a public limited liability company, the subscriber(s) of shares in the company (the founders) shall draw up a memorandum of association. The memorandum of association shall contain the company s articles of association ( 2-2) and the provisions that are mentioned in 2-3. (2) If shares may be paid for in non-cash assets, or if anybody is to be given special rights in connection with the formation, or the company is to pay the expenses of its formation, the memorandum of association shall so provide, cf. 2-4 and Minimum requirement to the articles of association (1) The articles of association shall at least state: 1. that the company shall be a public limited liability company; 2. the name of the company; 3. the municipality in Norway in which the company will have its registered office 4. the company s business; 5. the amount of share capital, cf. 3-1; 6. the par value of the shares (nominal value), cf. 3-1; 7. the number of shares; 8. the number or the minimum and maximum number of directors,cf. 6-1; 9. whether the company shall have two or more general managers or whether the board of directors or the corporate assembly may decide that the company shall have two or more general managers, and if so, whether these several general managers shall serve as a collective body; 10. the matters to be dealt with by the ordinary general meeting, cf (2) If the object of the company s business is not that of generating profit for the shareholders, the articles of association shall provide for the employment of any profit and of the capital in the event of liquidation Other minimum requirements to the memorandum of association The memorandum of association shall also state: 1. each founder s name or company name, address and personal number or organization number; 2. the number of shares to be subscribed by each founder; 3. the price payable for each share (share contribution); 446

3 4. the time of settlement for the share contribution, cf. 2-11; 5. the names of the company s directors, and the name of the company s auditor Provisions for special rights (1) The memorandum of association shall contain every agreement or other provision to the effect 1. that shares may be subscribed with a right or obligation to pay for them in non-cash assets, that the payment may be set off against a claim, or that shares may be subscribed on other special terms. In such case the memorandum of association shall describe the assets to be contributed, each subscriber s name and address, the number of shares the company is to issue for the contributed assets, and the applicable conditions; 2. that the company shall take over non-cash assets in return for other assets than shares. If so, the memorandum of association shall describe the assets involved, the assigner s name and address, the compensation to be made by the company, and the applicable conditions; 3. that the company shall be party to an agreement, or that anybody shall have special rights in respect of or benefits from the company. If so, the memorandum of association shall describe the applicable conditions and include the name and address of the beneficiary. (2) Instead of including the agreement or provision in the memorandum of association, the memorandum of association may refer to the agreement or the provision or to a report pursuant to 2-6. In such case the main clauses of the agreement or report shall be cited in the memorandum of association, and the agreement shall be attached to the memorandum of association. (3) An agreement or provision which has not been included in the memorandum of association according to the first paragraph or cited in the memorandum of association according to the second paragraph above, may not be invoked against the company Expenses of formation to be covered by the company (1) The company may cover the expenses of its formation to the extent that such expenses do not exceed the share capital contribution. The memorandum of association shall indicate the expenses, how they have been calculated, and the name and address of the person to whom they are paid. (2) An agreement or provision of content as set forth in the first paragraph is similarly subject to the provisions in 2-4 second and third paragraph above Report on non-cash share contribution and special rights (1) If the company is to take over assets or become party to an agreement as mentioned in 2-4, a report shall be prepared including at least: 1. a description of each payment, acquisition or agreement. If an existing business is to be taken over, the annual financial statement, annual report and auditor s report of the business for each of the last three years shall be included in or attached to the report. The report shall state the profit or loss from the operation during the period after the last balance sheet date. If annual financial statements for the business are not available, the report shall give account of the result of the operation in the last three years: 2. information about the principles that have been applied to the valuation of the assets the company is to take over; 3. information about the conditions that may be significant to the evaluation of an agreement or provision to the effect that the company will take over assets or become party to an agreement; 4. a declaration to the effect that the assets which will be taken over by the company have a value at least equivalent to the agreed compensation, including the nominal value of the shares that are to be issued as payment, with the addition of any premium. The time of the valuation can at the earliest be four weeks prior to the incorporation, cf The valuation of intangible assets that are to be taken over as payment for shares shall be separately accounted for. (2) The founders shall ensure that the report is prepared by one or more independent experts. As independent expert, an auditor shall be engaged. Ministry regulation may provide that also other professional groups may E be engaged as independent experts. The provisions on audit examination rights etc. in 5-2 third paragraph in N the Auditors Act will similarly apply. G (3) The report shall be attached to the memorandum of association. L (4) The King can through regulations make exceptions from first to third paragraph for circumstances I where shares are subscribed against deposits in tradable securities or money market instruments or against S deposits of other assets than money when the value of the deposit is stated in an audited, legally required financial H statement. 447

4 2-7. Non-cash contributions Assets that cannot be entered in the balance sheet according to the Accounting Act may not be used as contribution for shares. An obligation to perform work or a service for the company cannot in any case be used as contribution for shares. Assets received by the company in payment for shares shall be set at their actual value, unless it follows from the provisions of the Accounting Act that the contribution shall be valued at its balance sheet value Opening balance sheet (1) If share contribution can be made by other assets than money, if the company shall become party to an agreement, or if anyone shall be given particular rights as mentioned in 2-4, the founders shall prepare and date and sign an opening balance sheet to be attached to the memorandum of association. (2) The opening balance sheet shall be drawn up in accordance with the provisions of the Accounting Act. The auditor shall issue a statement to the effect that the balance sheet has been drawn up in accordance with said provisions. The opening balance sheet with the auditor's statement shall at the earliest be dated four weeks before the formation, cf The King may issue further regulations with regard to the requirement of an opening balance. In such regulations, exemptions may be made from the provisions in first to third sentence above. (3) The company shall have an equity according to the opening balance sheet equivalent at least to the company s share capital. This does not apply insofar as the share capital contribution shall be used for the purposes of covering formation expenses in accordance with Formation of the company The founders shall date and sign the memorandum of association. When all the founders have done so, the shares are subscribed and the company is formed Share subscription which is not binding (1) A subscription of shares which do not comply with the procedures laid down in 2-9 is not binding on the company or the subscriber. The same applies to subscription of a share when it is subject to a reservation which is not in accordance with the subscription documents. Notwithstanding the foregoing, the subscription is binding if the company is registered without the company or the subscriber having notified the Register of Business Enterprises that the subscription is not considered binding. (2) The provision of first paragraph, third sentence applies similarly when the share subscription is void according to general rules of property law transactions. The registration does not however make the subscription binding if it is forged, faked, made under gross coercion or is in conflict with the Guardianship Act. (3) If a share subscription is not binding, the board of directors may reduce the share capital and retire the share, unless such reduction or retirement would conflict with 3-1 first paragraph. If the share capital is reduced according to the preceding sentence, the board of directors may obtain a corresponding provision of share capital by separate res-olution of new subscription. Chapter 12 on reduction of the share capital does not apply to the board of directors resolution to reduce the share capital according to this section. II. Due date and settlement of claims for payment of shares etc Due date of the company s claim for share capital contributions The company s claim for contribution for shares arises when the shares are subscribed and falls due on the date stipulated in the memorandum of association. This date may not be later than the date on which the company is reported to the Register of Business Enterprises, cf Settlement of claim for contribution (1) The price of a share may not be lower than the nominal value of the share. If a share is subscribed at a lower price, the nominal value of the share shall nevertheless be contributed. (2) An agreement to settle the claim for contribution otherwise than as set forth in the memorandum of association does not release the subscriber. Whether or not the memorandum of association provides that the claim may be settled by a setoff, such settlement does not release the subscriber to the extent the setoff may cause a loss to the company or its creditors Delayed settlement of claim for contribution (1) In the event of delayed settlement of a claim for contribution in cash, the shareholder is obliged to pay interest from the due date according to the Overdue Payments Interest Act. (2) In the event of delayed settlement of a claim for non-cash contribution, the shareholder is obliged to pay interest to the company based on the value of the payment in the opening balance sheet. 448

5 (3) In the event of delayed settlement of a claim for contribution the board of directors shall by registered letter urge the shareholder to settle within a period of seven days from the mailing of the letter. The letter shall inform the shareholder of the consequences of exceeding that period, cf. fifth paragraph. If the shareholder has no known address, the demand for settlement must be published in the Brønnøysund Register Center s electronic bulletin for public announcements. (4) If the company knows that the share has changed owner or has been pledged, the owner or pledgee shall be notified as provided in the third paragraph. He shall also be notified if the share has been subject to distraint or arrest. (5) If settlement is not made within the stipulated period, the board of directors may allow another person to sub-scribe to the share subject to undertaking the payment obligation. If there are no reasonable prospects of collecting the outstanding amount, or the collection costs are disproportionate to the amount involved, the board of directors may instead reduce the share capital and retire the share, unless retirement would be in conflict with 3-1 first paragraph. If the share capital is reduced pursuant to the preceding sentence, the board of directors may within six months from registration of the company, provide corresponding cover of the share capital by separate resolution of new subscription. The board of directors resolution to reduce the share capital according to this paragraph is not subject to the provisions of chapter Defective non-cash contributions (1) If a non-cash contribution is factually or legally defective, the shareholder is obliged to compensate the company for the loss it has been inflicted from the defect. (2) If a legal defect prevents the contribution, the shareholder shall settle by payment of cash Forfeiture of claim for contribution due to limitation of time If the company forfeits its claim for contribution due to passage of time, the board of directors shall resolve to reduce the share capital and retire the shares and if appropriate to offer new shares for subscription. The rules of 2-10 third paragraphare similarly applicable Liability for contribution in connection with on change of owners of share If a share changes owner before the claim for contribution has been settled, the new and the former owners are jointly and severally liable for the claim when the transfer has been reported to the company The company s control over claims for contribution etc. The company s claim for contribution may not be assigned. Nor may it be deposited as security or be subject to distraint for debt. III. Report to the Register of Business Enterprises Reporting of the company to the Register of Business Enterprises (1) The company shall be reported to the Register of Business Enterprises within three months of signature of the memorandum of association. (2) Before the company is reported to the Register of Business Enterprises, the share capital contribution must have been paid in full. The results of any technical assistance, research and development services etc. shall have been made available to the company. In the report to the Register of Business Enterprises, it shall be confirmed that the company has received the share capital contributions. Such confirmation shall be given by the auditor. In the event that the share capital contributions shall be settled solely in cash, the confirmation may be given by a financial institution. (3) If the company has not been reported to the Register of Business Enterprises by the end of the above period, it may not be registered. Obligations under the memorandum of association are in such case no longer binding. Nor are they binding if registration is refused due to errors that cannot be remedied. E Responsibility for reporting the paid up share capital N (1) The directors and auditor or financial institution who have given a confirmation in accordance with G 2-18 second paragraph, are jointly and severally liable for any shortfall in theshare capital which has been L reported to the Register of Business Enterprises and has been confirmed as paid or otherwise settled. This rule I applies whether or not any loss has been caused. (2) Liability under paragraph one does not apply to any shortfall due to valuation of non-cash asset con- S tributions. H 449

6 2-20. Rights and obligations before entry in the Register of Business Enterprises (1) Before the public limited liability company has been registered, the company as such may not acquire other rights and incur other obligations to third parties than those following from the memorandum of association or from statute. (2) For obligations that have been incurred in the company s name before the registration and for which the company is not liable under first paragraph, the persons who have incurred the obligation are personally, jointly and severally liable except as otherwise agreed with the creditor. Upon registration, thecompany takes over the obligation. (3) If before the registration an agreement has been concluded which does not bind the company under first paragraph, and if the other party to the agreement knew that the company was not registered, the other party may disregard the agreement if the company has not been reported to the Register of Business Enterprises within the period mentioned in 2-18 or the report is refused before the expiry of the period. If the party was unaware that the company was not registered, he or she may revoke the agreement until the company is registered. The provisions of this paragraph may be set aside by agreement. Chapter 3. Company capital I. Nondistributable equity 3-1. Share capital (1) A public limited liability company shall have a share capital of at least one million Norwegian kroner. (2) The share capital shall be represented by one or more shares to which the shareholder rights relate. The shares shall have the same nominal value Fund for unrealized gains (1) The company shall have a fund for unrealized gains. If the company estimates assets at real value, it shall allocate to the fund a positive difference between booked balance value of each asset or group of assets and their acquisition cost taking into consideration the effect of deferred tax. This applies correspondingly to estimates of debt at real value. The company shall allocate to the fund in the same manner as described in the second sentence if the company, by adjustment of value or otherwise, books assets at a value exceeding the acquisition cost. (2) The duty to allocate to the fund for unrealized gains does not include differences pursuant to the first paragraph relating to the assessment of: 1. financial instruments in accordance with the Accounting Act 5-8, 2. money items in foreign currency, 3. other items when determined in regulations issued by the Ministry. (3) The fund may be dissolved when and to the extent that the basis for the allocation is no longer present. (4) The Ministry may by regulations issue rules regarding the calculation of the difference pursuant to the first paragraph Fund for valuation differences The company shall have a fund for valuation differences. If the company books company investments in subsidiaries, affiliated companies or mutually controlled undertakings using the equity method or the gross method, the company shall allocate to the fund a positive difference between the investments booked balance value and their acquisition cost. The company may omit to allocate to the fund a difference which is caused by profit from a transaction between an investor and a company booked using the equity method. Such difference shall at no time be higher than the investor s remaining unrealized profit. 3-3a. (repealed by Act of 14 June 2013 No. 40) II. Equity requirements 3-4. Requirement of adequate equity The company shall at all times have an equity and liquidity which is adequate in terms of the risk and scope of the company s business Obligation to act on loss of equity (1) If the equity is presumed to be less than adequate in terms of the risk and scope of the company s business, the board of directors shall forthwith deal with the matter. The same shall apply if the company s equity is assumed to be less than half the share capital.the board of directors shall within a reasonable time call a general 450

7 meeting and report to it on the company s financial position. If the company does not have adequate equity in accordance with 3-4, the board of directors shall propose to the general meeting measures to restore the equity. In such cases as mentioned in the second sentenceof this paragraph, the general meeting shall be convened within six months at the latest. (2) If the board of directors does not find it justified to propose measures as mentioned in first paragraph fourth sentence, or such measures are not feasible, it shall propose liquidation of the company. III. Distributions 3-6. Distribution from the company etc. (1)Any distribution from the company may only be done in accordance with the rules regarding dividends, capital reduction, merger or demerger of companies, and repayment following liquidation. (2) Distribution includes any transfer of values which directly or indirectly benefits the shareholder. The value shall be the actual value on the date of transfer. (3) When provisions in this Act stipulates amount limitations for the right to distribution from the company, it is an asset s balance sheet value that is determinative when considering whether the value falls within the limitations. The Ministry may by way of regulations deicide that another value can be relied upon in relation to stipulated distributions. (4) The Ministry may by way of regulations issue rules regarding the calculation of distributable and tiedup equity when the annual accounts are prepared in a currency other than Norwegian kroner Unlawful distributions (1) If a distribution has been made by the company contrary to statutory provisions of this Act, the recipient shall return the received assets. In the event of a distribution of dividends or repayment following capital reduction, merger, demerger or liquidation, the preceding rule is nevertheless inapplicable if the recipient, at the time he received the distri-bution, neither understood nor ought to have understood that it was unlawful. (2) Anybody who on behalf of the company assists in adopting or carrying out a resolution for unlawful distribution and who understood or ought to have understood that the distribution was unlawful, is liable for ensuring that the distribution is returned to the company. Such liability may be modified in accordance with 5-2 of the Liability Act. IV. Transactions between the company and shareholders etc Agreements with shareholders or members of the company s administration etc. (1) An agreement between the company and a shareholder, a shareholder s parent company, a director or the general manager shall not be binding on the company unless the general meeting has approved the agreement if the consideration from the company has a real value greater than one twentieth of the share capital at the time of the acquisition or sale. This rule does not apply to: 1. agreement concluded in accordance with the provisions in 2-4, cf. 2-6, and 10-2; 2. agreement as mentioned in 6-10 and 6-16a. 3. agreement concerning the transfer of securities at a price according to public quotation; 4. agreement entered into as part of the company s normal business and contains price and other terms that are customary for such agreements, 5. agreement covered by 8-7 third paragraph first sentence no. 2 and 3, cf. second paragraph, if the parent company or the legal person owns all shares in the company, 6. agreement entered into in accordance with rules given in or pursuant to (2) The board of directors shall ensure that a report is prepared on the agreement according to the rules of 2-6 first and second paragraph. The report shall contain a statement to the effect that there is a fair balance between the value of the consideration to be paid by the company and the value of the consideration to be received by the company. The report shall be attached to the notice to the general meeting and it shall with undue delay be notified to the Register of Business Enterprises. (3) Performance according to an agreement which is not binding on the company shall be returned. The provisions of 3-7 second paragraph shall apply similarly. (4) The provisions of first through third paragraph apply similarly when the agreement has been concluded with a shareholder s related party or a related party to a shareholder s parent company, or with anybody who acts by virtue of agreement or understanding with a party as mentioned in the provisions of the first paragraph. E N G L I S H 451

8 3-9. Intercompany transactions (1) Transactions between companies of the same group shall be based on customary business terms and principles. Major agreements between companies of the same group shall be made in writing. (2) Costs, losses, revenues and gains that cannot be attributed to any specific company of the group, shall be divided among the companies of the group in accordance with sound business practice. (3) Distribution of dividends and intercompany contributions from a company of the group to the parent company and other companies of the group shall in any one financial year altogether not exceed the limit set forth in 8-1. Chapter 4. Shareholders, transfer of shares etc. I. The shareholders rights in the company 4-1. The equality principle/share classes (1) All shares carry equal rights in the company. Notwithstanding the foregoing provision, the articles of association may provide that there shall be different kinds of shares (shares of different classes). The articles of association shall in such case specify the distinctions between the share classes, and the total nominal value of the shares within each class. (2) The articles of association may provide that shares of one class may be exchanged for shares of another class Entry in the register of shareholders as a condition for exercising shareholder s rights (1) The transferee of a share may only exercise the rights that pertain to a shareholder when the transfer has been entered in the register of shareholders, or when the transfer has been reported and proved without being prevented by restrictions following from the provisions of 4-16 through 4-23 below. This rule does not apply to the right to dividends and other distributions and the right to new shares in a capital increase. (2) In connection with a change of ownership, the transferee and transferor may agree that the rights that pertain to a shareholder may be exercised by the transferor until such rights have been transferred to the transferee. (3) The articles of association may provide that the right to attend and vote at the general meeting may only be exercised when the transfer has been entered in the register of shareholders five working days prior to the general meeting (date of registration) Jointly owned shares If two or more shareholders own shares jointly, they shall appoint one of the owners to act as shareholder towards the company, except as otherwise provided in the articles of association. II. Register of shareholders 4-4. Requirement of register of shareholders (1) When a public limited liability company has been formed, the board of directors shall without delay ensure the creation of a register of shareholders for the company in a securities registry. If the register of shareholders is established before the company has been registered in the Register of Business Enterprises, this shall be stated. When registration with the Register of Business Enterprises has been completed, the board of directors shall report this to the securities registry without delay. (2) The register of shareholders shall state: 1. the name of the company; 2. the share capital of the company; 3. the nominal value of the shares; 4. each shareholder s name, date of birth and address, or - for legal entities - the name, organization number and address; 5. the number of shares owned by each shareholder and the class to which the shares belong, if any; 6. if there are two or more classes of shares in the company, the special rules applying to the shares in the classes that are subject to special rules; 7. whether the right to transfer or pledge shares is restricted by the articles of association; 8. whether the shares may be redeemed without the shareholder s consent; 9. whether there are special obligations associated with the shares other than payment of capital contribution. 452

9 4-5. Access to the register of shareholders The register of shareholders shall be accessible to anyone. The King may issue rules regarding the right to access according to the preceding sentence, and may decide that the company shall upon request issue a transcript of the register of shareholders subject to a stipulated fee Duty to disclose amendments of the articles of association If an amendment of the articles of association may cause a misinterpretation of the registered articles of association that may lead to loss or inconvenience, it is incumbent upon the board of directors to ensure an amendment of these entries Change of owners In the event of change of ownership, the former owner shall forthwith ensure that it is reported to the securities registry Capital increase (1) In the event of a capital increase the new shares shall be registered from the date on which the shares give rights in the company. (2) If the capital increase is not registered in the Register of Business Enterprises, this shall be noted in the register of shareholders. When registration in the Register of Business Enterprises has been completed, the board of directors shall forthwith report this to the securities registry Share certificates (1) When a shareholder has been registered in the register of shareholders, the company shall notify the shareholder of such registration. (2) The notification shall be dated and include the information about the shareholder and his or her registered shareholdings. In the event of amendments in the registered information, the company shall notify the shareholder of such amendment Trustee registration (1) A bank or any other trustee approved by the King may be entered in the register of shareholders instead of a foreign shareholder when the shares are approved for trade on a Norwegian regulated market. A foreign shareholder is a company registered in a foreign country, except when the company s head office is situated in Norway, and a foreign national who is not resident in Norway. The King may consent to trustee registration of shares belonging to foreign shareholders also in other cases than thosementioned in the first sentence of this paragraph. Another Norwegian securities registry may in accordance with rules issued by the King create a partial register which is incorporated in the register of shareholders on behalf of a shareholder. 4-5 applies similarly for the partial register The company may in the articles of association stipulate that the company s shares may not be subject to a trustee registration. (2) The register of shareholders shall set forth the name and address of the trustee and state that he is the trustee of the shares. The register shall also state the number of shares comprised at any time under the trusteeship. (3) A trustee may not exercise other rights in the company than the right to receive dividends or other payments on the shares comprised under the trusteeship, including the allotment of new shares in connection with a capital increase. The trustee is authorized to receive such payments. (4) If so demanded by the company or a public authority, the trustee is obliged to name each owner of the shares comprised under the trusteeship, and disclose the number of shares belonging to each owner. (5) The King may issue regulations regarding the registration of trustees, and as to whether the trustee is obliged to furnish public authorities with information about the ownership of the shares that are held in trust, and the obligation to furnish public authorities or others with periodical reports about the ownership of the shares. E III. Register of subscription rights N G Register of subscription rights L (1) The company shall have a register of subscription rights registered in the securities registry in which I the company s shares are registered. (2) The following information shall be entered into the registry of subscription rights: S 1. any preferential rights of a shareholder when the share capital is increased by subscription of new shares; H 2. any right to require the company to issue a share to a creditor according to an agreement regarding loans to the company; 453

10 3. any right to require the company to issue a share to a shareholder as a consequence of the subscription of new shares in the company; 4. any right to require the company to issue a share to the holder of special subscription rights issued by the company. (3) Subscription right as aforesaid shall also be entered into an account which the holder of the rights shall have in a securities registry. The provisions in 4-10 will similarly apply. (4) The register of subscription rights shall state: 1. the name of the company; 2. the name, date of birth and address of the holder of the rights, or - in the case of legal entities - the name, organization number and address; 3. the number of shares comprised under the subscription right, or the number of subscription rights that are required for the subscription of one share; 4. the share class to which the new shares shall belong if there are to be shares of different classes in the company; 5. whether the subscription right is linked to a share or to a claim, and whether the holder of the right may in such case separate the subscription right from the share or claim. (5) The right of access under 4-5 applies similarly to the register of subscription rights. IV. Transfer and other change of ownership Special reporting duty for directors, senior executive officers etc. (1) Each director, auditor, chief executive and other senior employees shall immediately notify the board of directors of their own and any personally related party s sale or acquisition of shares or other securities in the company. The notification shall be entered into a separate protocol. (2) The provisions of the preceding paragraph apply similarly to the sale and acquisition of shares or other securities in other companies of the same group. (3) The King may issue further rules on the notification duty under this section Identification and legal protection rules on change of ownership (1) The legal effects of registration in a securities registry are subject to 7-1, 7-2 and 7-4 in the Norwegian Securities Registry Act. (2) The aquirer of such a share will not aquire better rights to collect dividends or other payments from the company than the seller had. However, any distribution other than dividendsonly release the company from the obligation towards a later acquirer in good faith, if it has been registered on the shareholder s account in a securities registry. (3) The articles of association are binding upon the acquirer even if the register of shareholders contains incorrect or incomplete information. Any restriction in the right to transfer or pledge the shares which has not been registered may however only be invoked against the acquirer if 1. the acquirer knew or ought to have known about the restriction at the time the acquisition was registered, or 2. the failure of registration is due to an error in a securities registry Share subscription rights The provisions in 4-7, 4-12 and 4-13 apply similarly to share subscription rights. V. Share transferring and pledging rights Share transferring rights (1) Shares may change owner by transfer or by other means except as otherwise provided by statute, the company s articles of association or agreement between the shareholders. (2) If the articles of association provide that the acquisition of shares is subject to approval from the company, that a shareholder or acquirer of a share shall have specific qualities, or that a shareholder or other person shall have the right to take over a share that has been or is to be transferred, the provisions of 4-16 through 4-23 shall apply. (3) Transfer restrictions in the articles of association or agreement among the shareholders are subject to the provisions in 36 of the Agreements Act. (4) The provisions in the three preceding paragraphs, cf through 4-23 below, apply similarly to share subscription rights. 454

11 (5) The articles of association may not provide other limitations in the shareholders right to transfer shares, from the date of registration cf. 4-2 third paragraph until the general meeting, than what is otherwise applicable. 4-15a. Pledging of shares Shares may be pledged unless otherwise provided in the articles of association. Pledge in shares will obtain legal protection according to the rules of the Securities Registry Act. Agreement may provide that dividends are to be distributed to the pledgeholder, without the limitations in 8-3 second paragraph. VI. Consent requirements in the articles of association in connection with change of ownership The board of directors decision (1) If the articles of association provide that acquisition of a share is subject to consent, it pertains to the board of directors to decide whether to grant such consent, unless otherwise provided in the articles of association. The decision shall be made as soon as possible after the acquisition has been reported to the securities registry. (2) Consent may not be withheld in the event of change of ownership by way of inheritance when the acquirer is personally related to the former owner. In any case consent may only be withheld on justifiable grounds. The articles of association may provide further conditions for withholding consent. (3) The acquirer shall without delay be notified of the decision. If consent is withheld, the acquirer shall be provided with the reason thereof and be informed of any actions required to remedy the situation cf (4) If the acquirer has not been informed that consent has been withheld within two months following the report on the acquisition, consent shall be deemed to have been granted The effect of withholding consent (1) In the event that the board of directors withholds consent to the acquisition, the acquirer may 1. amend the agreement with the transferor, except as otherwise provided in the agreement; 2. dispose of the share; 3. initiate legal proceedings to try the validity of the refusal. (2) Any measure under the preceding paragraph must have been commenced within two months after the acquirer was informed that consent to the acquisition had been withheld, unless the articles of association provide a longer period. If the period is exceeded, the board of directors may require the share to be sold through the enforcement authorities in accordance with the provisions on compulsory sale. The provisions of 10-6, cf of the Enforcement Act regarding the minimum acceptable bid, do not apply to the sale. If legal proceedings have been initiated to try the validity of a refusal decision, compulsory sale may at the earliest take place two months subsequent to a legally enforceable judgment. VII. Provisions of the articles of association requiring a transferee or owner of a share to have certain qualities Provisions of the articles of association requiring a transferee or owner of a share to have certain qualities If the articles of association provide that an acquirer or an owner of a share shall have certain characteristics, the board of directors may give an acquirer or owner who fails to meet these requirements a period of at least three months to remedy the situation. If within that period the owner has not 1. amended the agreement, 2. disposed of the shares, or 3. initiated legal proceedings to try whether the requirements in the articles of association have been complied with, the provisions on compulsory sale in 4-17 second paragraph will apply. E VIII. Pre-emption right under articles of association N G Pre-emption right The articles of association may provide that a shareholder or other person shall have the right to acquire a L share that has been or is to be transferred. If such articles of association have been adopted, the provisions of I 4-20 through 4-23 will apply except as otherwise provided in the articles of association. S H 455

12 4-20. Notification to holders of the right When the securities registry receives notification pursuant to 4-7, it shall immediately notify the company. The company shall immediately send written notifications to the right holders. The same procedure applies if a shareholder notifies the company that shares have been or are to be transferred When does the pre-emption right arise (1) The pre-emption right arises in the event of any form of change of ownership, except as otherwise provided by statute. (2) The right may be exercised against any acquirer, except an aquirerwho is personally related to the former owner or a relative in direct line of ascent or descent of the former owner. (3) The pre-emption right may not be exercised for less shares than the total number of shares for which the right can be exercised. In the event of consecutive transfers of several shareholdings from the same owner or several owners, the right shall be exercised in respect of all the shares as a whole Who has the pre-emption right (1) All shareholders have equal priority with regard to the right to acquire the share or the shares. (2) When the pre-emption right is exercised by two or more shareholders in the company, the shares will be allotted to them in proportion to the number of shares in the company already owned by these shareholders. If there are two or more share classes in the company, shareholders of the same class have a preferential right over shareholders of other classes. (3) Shares that cannot be allotted equally according to the rules of the two preceding paragraphs shall be allotted among the shareholders by drawing of lots Exercise of the pre-emption right (1) The pre-emption right is exercised by notification to the company. The notification must have arrived at the company no later than two months after the notification on the change of ownership in accordance with 4-20 was received by the securities registry or the company. (2) The redemption amount shall be fixed in accordance with the actual value of the share at the time the right is exercised. Any provision in the articles of association which sets forth the price or how the redemption price should be calculated may be adjusted in accordance with 36 of the Contract Act. The holder of a right shall within the two-month period mentioned in the first paragraph have taken the necessary steps to have the redemption amount finally determined according to a procedure set forth in the articles of association or if appropriate by requesting a valuation. Can agreement on the redemption price not be reached it shall be determined by valuation except as otherwise agreed. (3) The redemption amount is due and payable within one month following from the day on which the notice of the exercise of the pre-emption right was put forward or within two weeks from the final decision of a dispute about the redemption amount. (4) The time limit set forth in this section may not be extended in the articles of association. IX. Forced transfer of shares Redemption of small shareholdings (1) The company may make an offer to acquire shares that are owned by shareholders who each have so few shares in the company that the combined value of the shares according to the official price on the offering date does not exceed 500 kroner. An offer stating the redemption amount per share and the time limit within which to accept the offer shall be sent in writing to all shareholders whom the offer applies and whose address is known and. The acquisition shall be in accordance with the provisions regarding acquisition of treasury stock in 9-2 through 9-8. (2) If the company has made an offer in accordance with the provisions in the first paragraph, without all the shares under the offer having been acquired by the company, the Ministry may give the company permission to execute a compulsory transfer of the remaining shares. (3) When the company has decided to execute a compulsory transfer under the Ministry s permission, the company shall be entered in the register of shareholders as the owner of the shares. This does not apply to shares of shareholders who after the offer was presented, have been registered as acquiring so many shares that they are no longer comprised under the offer. (4) The provisions of 4-25 second, third and fourth paragraph on the determination of the redemption amount will similarly apply. 456

13 (5) The valuation will take place in the venue where the company has its registered office. All the shareholders affected by the valuation may be called as parties. The company shall cover any expenses raised by the valuation Forced transfer of shares in subsidiaries etc. (1) When a public limited liability company alone or through subsidiaries owns nine tenths or more of the shares in a subsidiary and may exercise a corresponding part of the votes that may be cast in the general meeting, the board of directors of the parent company may resolve that the parent company shall take over the remaining shares in the subsidiary. Each of the other shareholders of the subsidiary shall have the right to demand the parent company to take over the shares. (2) The redemption amount will in the absence of agreement or acceptance of offer according to paragraph threethird sentence be fixed by discretionary valuation at the expense of the parent company. Whenever special reasons so indicate it may be decided that all or part of the expenses shall be paid by the other party. The discretionary valuation shall be held in the venue where the company has its registered office. (3) The parent company shall give the shareholders a redemption offer. If this offer is addressed in writing on paper to all shareholders whose addresses are known, and is in addition published in the Brønnøysund Register Center s electronic bulletin for public announcements a time limit may be set within which each shareholder may raise objections or reject the offer. If such objection does not reach the company within the time limit, the shareholder shall be deemed to have accepted the offer. The period may not be shorter than two months following the announcement. The written offer and the announcements shall draw the shareholder s attention to the time limit and the consequences of exceeding it. (4) Even if a shareholder is deemed to be bound under paragraph three third sentence above, the court may on motion of the shareholder set aside the agreement pursuant to the provisions in 36 of the Contract Act. The company shall cover any expenses which the proceedings raise. The provisions of paragraph two second and third sentences will similarly apply. (5) When a parent company has decided to take over shares according to paragraph one above, the parent company shall be registered as owner of the shares in the register of shareholders. At the same time the parent company shall pay the total offer price to a separate account with a bank which can conduct business in Norway. (6) The provisions in paragraph one through five apply similarly when a shareholder who is not a public limited liability company owns such large shareholdings in a public limited liability company as provided in paragraph one. (7) With regard to redemption in connection with mandatory bids and voluntary bids as set out in chapter 6 of the Securities Trading Act, special provisions as provided in 6-22 of the Securities Trading Act will apply. Chapter 5. General meeting I. General rules 5-1. Authority of the general meeting (1) Through the general meeting the shareholders exercise the supreme authority in the company. (2) The foregoing provision notwithstanding, the general meeting may not review resolutions of the corporate assembly pursuant to 6-37 first and fourth paragraph or board of directors resolutions under 6-37 fourth paragraph second sentence. The King may grant individual exceptions from the preceding sentence when the company is a subsidiary and the employees of the subsidiary have a right to be represented on the board of directors or in the corpo-rate assembly pursuant to a resolution as mentioned in 6-5 or 6-35 fifth paragraph, or in the articles of association Shareholders attendance. Proxy (1) The shareholders have the right to attend general meetings, either personally or by proxy at their option. The right of attendance may not be restricted by the articles of association. E (2) The person authorized to serve under proxy shall submit a written and dated instrument of proxy. If the N proxy is presented by way of electronic transmission, a secure method shall be utilised to authenticate the trans- G mittor. The proxy is deemed valid only for the forthcoming general meeting unless otherwise is clearly provided. L The shareholder may at any time revoke the proxy. With regard to a revocation of proxy, first and second sentence I will similarly apply. (3) A shareholder may be assisted by an adviser and may give one adviser the right to speak. S H 457

14 5-3. Requirement of advance notice to the company (1) The articles of association may provide that shareholders who intend to participate in the general meeting shall notify the company accordingly within a certain time limit. The time limit may not expire earlier than five days before the meeting. (2) The time limit shall be stated in the notice of the general meeting. A shareholder who has not given notice within the time limit may be denied access Voting rights. Disqualification (1) Each share carries one vote except as otherwise provided by statute or the articles of association. The articles of association may restrict the voting rights of certain persons. The articles of association may also provide that the shares of a certain share class shall not carry voting rights or shall have limited voting weight. Any such provision is subject to the approval of the Ministry if the combined nominal value of shares in the company with such voting restrictions shall make up more than half the share capital in the company. (2) Voting restrictions related to a share or a person rank after provisions of this Act which grant rights to each shareholder or to shareholders who own or represent a certain part of the share capital. The same will similarly apply to provisions that - in order for a resolution to be adopted - require the support of a certain part of the share capital which is represented at the general meeting. (3) Voting rights may not be exercised for a share which belongs to the company itself or a subsidiary. Such a share shall not be counted when a resolution requires the consent of all the shareholders or a certain part of the share capital, or when a right can be exercised only by the owners of a certain part of the company s share capital. (4) Nobody may personally or by proxy or as proxy participate in a vote at the general meeting regarding legal action against himself or regarding his own liability to the company, or regarding legal action against others or regarding other persons liability if he or she has a major interest in the case that may be in conflict with that of the company Right and obligation of the management to attend the general meeting (1) The chairman of the board and the general manager and the chairman of the corporate assembly shall attend general meetings. When absent for valid reasons, a deputy shall be appointed. Other members of the board and members of the corporate assembly may attend the general meetings. (2) The members of the board, general manager and members of the corporate assembly may speak in general meetings. II. General meetings etc Ordinary general meeting (1) Within six months from the end of each financial year, the company shall hold an ordinary general meeting. (2) The ordinary general meeting shall deal with and decide on the following matters: 1. adoption of the annual financial statement and annual report, including the distribution of dividends; 2. any other matters which by virtue of law or the articles of association pertain to the general meeting. (3) The ordinary general meeting shall also deal with the board of directors declaration concerning the fixing of salaries and other remuneration to senior employees pursuant to 6-16a. An advisory vote shall be held following the board of directors guidelines for fixing remuneration to senior employees. The guidelines on remuneration as mentioned in 6-16a first paragraph third sentence must be approved at the general meeting. (4) Public Limited Liability Companies which are under an obligation to provide a statement of business management in accordance with the Accounting Act 3-3 b shall deal with this matter at the ordinary general meeting. (5) The annual financial statement, annual report, auditor s report and statement by the corporate assembly pursuant to 6-37 third paragraph and the declaration of the board of directors pursuant to 16-6a shall at the latest one week before the general meeting be sent to every shareholder whose address is known Extraordinary general meeting (1) The board of directors, corporate assembly or chairman of the corporate assembly may decide to call an extraordinary general meeting. (2) The board of directors shall call an extraordinary general meeting whenever the auditor who audits the company's annual accounts or shareholders representing at least one twentieth of the share capital so demand in writing in order to deal with a specific matter. The board of directors shall ensure that the general meeting is held within one month from the demand was submitted. 458

15 5-8. Place of the general meeting The general meeting shall be held in the municipality where the company has its registered office, unless the articles of association provide that it shall or may be held in another specified place. If necessary for special reasons, the general meeting may be held elsewhere. 5-8a. Electronic participation on general meetings (1) Unless the articles of association provide otherwise, the board of directors may decide that shareholders may participate in the general meeting by electronic means, including a right for shareholders to exercise his or her shareholder rights by electronic means. (2) The board of directors may establish a right as provided for in paragraph one only if it ensures that the general meeting can proceed safely and properly and that there are systems which ensure compliance with statutory provisions regarding general meetings. The system must ensure satisfactory control of participation and voting at the general meeting, and a secure method must be put in place to authenticate the sender. (3) The articles of association may provide further requirements with regard to participation on the general meeting by electronic means. 5-8b. Written vote prior to the general meeting The articles of association may provide that the shareholders may, within a limited time prior to the general meeting, deliver their votes in writing, which shall include the use of electronic means. Voting in writing requires an adequately secure method to authenticate the sender. The articles of association may provide further requirements with regard to voting in writing. III. Notice and information to shareholders in connection with general meetings 5-9. Authority to convene a general meeting (1) General meetings are convened by the board of directors. Companies which have a corporate assembly may provide in the articles of association that the general meeting shall be called by the chairman of the corporate assembly. (2) Should the board of directors or chairman of the corporate assembly fail to call a general meeting which is to be held by virtue of statute, the articles of association or a former resolution of a general meeting, the District Court shall do so immediately upon request from a member of the board, a member of the corporate assembly, the general manager, the auditor who audits the company's annual accounts or a shareholder. Any expenses shall be covered by the company Requirements to the notice (1) The general meeting is convened by written notice to all shareholders whose address is known. The notice shall set forth the time and place of the meeting. The company may not require compensation in any form for the submission of the notice. (2) A notice of general meeting shall be sent at the latest two weeks before the date of the meeting, unless the articles of association require a longer period. Any such provision in the articles of association does not apply to a notice which is given following a demand under 5-7 second paragraph above. (3) The notice shall, in a proposal to the agenda, specify the matters which are to be dealt with at the general meeting. Any proposal to amend the articles of association shall be quoted in the notice. The notice shall also state the name of the person appointed by the board of directors to open the general meeting, or the name of the person who will be opening the general meeting pursuant to the articles of association, cf first paragraph. The board of directors shall prepare a proposal for the agenda in accordance with the provisions of law and the articles of association. (4) Companies providing participation by electronic means at the general meeting in accordance with 5-8 a or voting as laid down in 5-8 b, shall in the notice of the general meeting inform the general meeting of this matter. Companies which by way of articles of association have adopted a resolution in accordance with 5-11 E a, shall in its notice provide information as to the internet site of the company and information that shareholders N may need in order to have access to these documents, and information as to whom the shareholders may turn to G in order to have the documents submitted to them. Companies which by way of articles of association have L adopted a resolution in accordance to 4-2 paragraph three, shall in the notice state the company s date of registration and that only those shareholders who have been registered in the register of shareholders have the right I to participate and vote in the general meeting. S (5) The requirements in 5-9 second and third paragraph of the Securities Trading Act will apply similarly H to companies comprised by 5-4 of the Securities Trading Act. 459

16 5-11. A shareholder s right to have matters dealt with by the general meeting A shareholder has the right to put matters on the agenda of the general meeting. The matter shall be reported in writing to the board of directors within seven days prior to the time limit for the notice to the general meeting, along with a proposal to a draft resolution or an explanation as to why the matter has been put on the agenda. In the event that the notice has already taken place, a new notice shall be sent if the time limit has not already expired. A shareholder has in addition a right to put forward a proposal for resolution. 5-11a. Exemption to the requirement to submit documents which have been posted on the internet site of the company The articles of association may provide that when documents have been made available on the internet site of the company regarding matters which are to be dealt with at the general meeting, the statutory requirements which state that these documents shall be sent to the shareholders shall not apply. This exemption is also applicable with regard to documents which according to statutory law shall be included in or attached to the notice of the general meeting. A shareholder may in any case require the submission of documents regarding matters which are to be dealt with at the general meeting. The company shall be required to send the documents free of charge to every shareholder who so requests. 5-11b. Special rules with regard to convocation and information to shareholders about the general meeting in companies whose shares have been admitted to quotation on a regulated market For companies whose shares have been admitted to quotation on a regulated market, cf. the Regulated Markets Act of 29 June 2007 no. 74 3, and which are situated in, or carry on activity in an EEA state, the following special rules apply: 1. The time limit for notice pursuant to 5-10 second paragraph, first sentence is 21 days, unless the articles of association provide otherwise, cf. Securities Trading Act 6-17 paragraph six. In companies where shareholders may vote by electronic means cf. 5-8 a, the general meeting may by majority as for amendments of the articles of association and with effect until the next annual general meeting determine that notice of a general meeting shall be sent no later than two weeks prior to the general meeting. 2. The notice shall in addition to the requirements in 5-10 comply with the requirements following from regulations determined by the King regarding the implementation of Directive 2007/36/EC Article 5 no Information and forms regarding the general meeting shall be available to shareholders on the internet site of the company in compliance with regulations determined by the King as part of the implementation of Directive 2007/36/EC Article 5 no. 4 and Article 14 no. 2. IV. Meeting rules Opening of the meeting. Person chairing the meeting (1) General meetings are opened by the chairman of the board or by a person appointed by the board of directors. If the company has a corporate assembly, the general meeting is opened by the corporate assembly chairman or another person appointed by the corporate assembly. If the articles of association determine a chairman of the meetingcf. paragraph 3 second sentence, the general meetings shall be opened by the chairman of the meeting. (2) The District Court shall appoint the person who will open the general meeting if so demanded by shareholders representing more than one twentieth of the share capital no later than seven days prior to the general meeting. The same applies when the general meeting is called by the District Court. The decision of the Court may not be appealed. (3) The general meeting shall elect a chairman for the meeting who need not be a shareholder. The articles of association may name the person to chair the meeting List of shareholders at the meeting The person opening the meeting shall before the first vote draw up a list of the shareholders who are attending the meeting, either personally or by proxy. The list shall set forth the number of shares and votes each of them represents. The list shall be used until altered by the general meeting Matters outside the agenda (1) Matters that have not been reported to the shareholders according to the rules for convening the general meeting may not be decided at the meeting without the consent of all shareholders. (2) The fact that the matter has not been entered on the agenda shall nevertheless not prevent 460

17 1. the ordinary general meeting from deciding matters which pursuant to law or the articles of association shall be dealt with in the meeting; 2. the ordinary general meeting from deciding proposals for investigation under 5-25 first paragraph; 3. a resolution to convene for a new general meeting to decide any proposals submitted at the meeting Disclosure duty of the management (1) A shareholder may require members of the board, members of the corporate assembly and general manager to furnish in general meetings all available information about matters that may affect the consideration of 1. the adoption of the annual financial statement and annual report; 2. any matters that have been submitted to the shareholders for decision; 3. the company s financial position, and the business of other companies in which the company participates, and any other matters which the general meeting is to deal with, unless the information required cannot be given without disproportionately harming the company. (2) If information has to be sought so that answers cannot be given at the general meeting, written answers shall be prepared within two weeks after the meeting. The answers shall be kept available to the share-holders at the company s office and sent to all shareholders who have asked for the information. An answer which is deemed to be of major importance to the consideration of matters as mentioned in paragraph one shall be sent to all shareholders whose address is known Minutes (1) The person chairing the meeting shall ensure that minutes from the general meeting are kept. (2) Resolutions of the general meeting shall be entered in the minutes together with the outcome of the voting. The minutes shall state the number of submitted votes, how many shares and the part of the share capital representing the number of submitted votes, in favor of and against the resolutions to the extent this is relevant for the outcome of the vote. The list of the attending shareholders pursuant to 5-13 shall be included in or attached to the minutes. (3) The minutes shall be signed by the person chairing the meeting and at least one other person elected by the general meeting among the attending shareholders. The minutes shall be kept available to the share-holders at the company s offices and shall be adequately stored. V. Majority requirements etc Ordinary majority requirement (1) A resolution of the general meeting requires a majority of the votes cast, except as otherwise provided by statute. In the event of a tie, the person chairing the meeting has the casting vote, whether or not he has voting rights. (2) In the case of election or employment, the person(s) who obtains the largest number of votes is deemed to be elected. The general meeting may decide in advance that renewed voting shall be held if nobody obtains a majority of the votes cast. In the event of a tie, the decision will be made by drawing of lots. (3) The articles of association may provide for majority requirements that differ from those of the present paragraph, and provide differing rules in the event of a tie Amendment of the articles of association (1) A resolution to amend the articles of association shall be adopted by the general meeting, except as otherwise provided by statute. The resolution requires the support of at least two-thirds of the votes cast and of the share capital represented at the general meeting. (2) A resolution to amend the articles of association which detracts from the rights of an entire class of shares requires the support of owners of two-thirds of the represented capital of that class. Moreover, at least half the votes of the shareholders who do not own shares in any other class shall have been cast in favour of the proposal. E (3) The articles of association may provide stricter majority requirements than those contained in the pres- N ent paragraph. G L Qualified majority requirement I (1) The supporting vote of owners of shares making up more than ninetenths of the share capital represented at the general meeting, and moreover a majority as for amendments of the articles of association, are S required for a resolution which in respect of issued shares causes the shareholders right to dividends or to the H company s assets to be reduced otherwise than by a provision as mentioned in 2-2 second paragraph. 461

18 (2) In a company where the shares may change owner without the consent of the company under 4-15 second paragraph, cf and 4-17, the majority mentioned in paragraph one is required also for a resolution under which issued shares can be acquired only with the consent of the company. In a company in which the shares may change owner regardless of the provisions on pre-emption rights pursuant to 4-15 second paragraph, cf through 4-23, the same majority requirement applies to a resolution which for issued shares has the consequence that the shareholders shall be entitled to take over a share which has changed or will changes owner (pre-emptive right). The majority requirement in paragraph two shall also apply to a resolution which for issued shares has the consequence that the acquirers of a share or shareholders shall have certain qualifications, cf above Requirement of unanimity etc. (1) A resolution requires the support of all the shareholders when it in respect of issued shares, has the result: 1. that the obligations of the shareholders towards the company are increased; 2. that the right to assign or acquire shares in the company is restricted otherwise than as mentioned in 5-19 second paragraph; 3. that shares may be subject to compulsory redemption; 4. that the legal relationship among formerly equivalent shares is altered; 5. that the right of shareholders to collect dividends or to the company s capital is reduced by a provision as mentioned in 2-2 second paragraph. (2) If such a resolution affects only some of the shareholders, the resolution requires the support of all affected shareholders and moreover a majority as for amendments of the articles of association Abuse of the general meeting s authority A general meeting may not adopt any resolution which is suited to give certain shareholders or others an unreasonable benefit at the expense of other shareholders or the company. VI. Legal action to void a resolution Authority to bring legal action for voidance A shareholder, director, member of the corporate assembly or general manager may bring legal action to void a resolution of a general meeting on the ground that it was unlawfully adopted or is otherwise in conflict with statute or the articles of association of the company. Such action may also be brought by a majority of the employees or alternatively unions that comprise two-thirds of the employees Period allowed for bringing legal action (1) Any legal action to void a resolution under 5-22 must be brought within three months after the resolution was adopted. Otherwise the resolution is valid. (2) The provisions in paragraph one are not applicable in the event that: 1. the resolution is of such character that it cannot be adopted even with the consent of all the shareholders; 2. the resolution is subject to the consent of all or certain shareholders by virtue of statute or the articles of association and such consent has not been given; 3. notice of general meeting has not taken place, or the rules on notices to general meetings have been substantially disregarded; 4. legal action is brought within two years from the time limit set forth in paragraph one and the court finds that the plaintiff has had reasonable grounds for his dereliction and that it would be manifestly unreasonable to deem the resolution valid Judgment voiding the resolution (1) A judgment voiding a resolution adopted by the general meeting or which alters the resolution will take effect for all those who are granted the right to bring legal action pursuant to (2) The judgment may only alter the resolution if the plaintiff has submitted a motion to that effect and the court is able to determine the content which the resolution ought to have had. (3) If the resolution has been reported to the Register of Business Enterprises, the judgment shall be reported and registered with the Registrar. It is incumbent upon the company to cover any expenses arising hereof. 462

19 VII. Investigation Proposal for investigation (1) A shareholder may propose that the incorporation of the company, its administration or specified matters relating to the administration or the accounts be investigated. The proposal may be submitted at an ordinary general meeting or at a general meeting whose agenda sets forth the proposal for an investigation. (2) If the proposal is supported by shareholders owning at least one-tenth of the share capital which is represented at the general meeting, any shareholder may within one month from the date of the general meeting require the District Court to pronounce by decree a decision for investigation Decision of the District Court (1) The District Court shall comply with a requirement for investigation under 5-25 second paragraph if the court finds that it has reasonable grounds for doing so. (2) Before the court comes to a decision, the court shall give the company and if appropriate, any other party whom the investigation will also comprise, an opportunity to give a statement. (3) The court appoints one or more investigators. The provisions regarding the auditor as set out in 4-1 through 4-7 and 5-2 third paragraph in the Auditors Act will similarly apply to the investigators. They have an obligation to maintain secrecy according to the provisions applicable for auditors. (4) The court fixes the investigators fees in its decree. It is incumbent upon the company to cover the expenses relating to the investigation. The court may decide that the company shall make an advance deposit of an appropriate amount Investigators' right to information (1) The senior employees in the company, members of the board of directors and corporate assembly and any authorized accountants according to the Accounting Act, shall, upon the investigators' request, hand over any information of which they have knowledge and may be of importance to the investigation. The disclosure obligation in this provision applies similarly to persons who formerly held such managerial positions or duties as set out in the first paragraph. (2) The company shall give the investigators access to conduct such investigations as they find necessary, and shall hand over information which the investigators may require in the course of the investigation. Demands for release of information shall be submitted to the company in writing, and the company shall be given a time limit of minimum one week to complete the requirements. (3) The investigators' disclosure demands as defined in the second paragraph of this provision concerning documents or other objects which may contain information of importance for the investigation, and which the company is required to prepare or be custodian of, is basis for extinction in accordance with the Enforcement Act 13-2 first paragraph. (4) The company's bank connections shall give the investigators access to information regarding the company's customer relationship with the bank, and confidentiality clauses shall not apply Investigation report (1) The investigators shall submit a written report on the investigation to the District Court. (2) The court convenes for a general meeting to deal with the investigation report. The report shall at least one week before the meeting be sent to every shareholder whose address is known. Chapter 6. Company management I. Requirements of board of directors and general manager. Election of board of directors, term of service etc Board of directors E (1) The company shall have a board of directors comprising of at least three members. Companies which N have a corporate assembly shall have a board comprising of at least five members. G (2) The board of directors elects its own chairman except when he has been elected by the general meeting, L cf. however The board of directors shall always elect its chairman if it has been agreed that the company shall not have a corporate assembly, cf (2). I (3) The general manager may not be member of the board of directors. S H 6-2. General manager (1) The company shall have a general manager. 463

20 (2) The general manager is appointed by the board of directors. In the articles of association the authority of the board of directors may however be vested in the corporate assembly, or in the general meeting if the com- pany does not have a corporate assembly. In the event that it has been agreed that the company shall not have a corporate assembly, cf second paragraph, it is always for the board of directors to elect the general manager Election of members of the board of directors (1) Directors are elected by the general meeting, which also decides whether to elect any deputy directors. (2) The preceding paragraph does not apply to directors who are to be elected by the employees in the company under 6-4, or who are to be elected by the corporate assembly under (3) The articles of association may provide that the general meeting s right of election pursuant to paragraph one shall be transferred to others. More than half of the board of directors must, however, be elected by the general meeting unless the right to elect is assigned to a corporate body stipulated in the articles of association. The right of election may not be transferred to the board of directors or to a member of the board of directors Employees right to elect members of the board of directors (1) When a company with more than 30 employees has not established a corporate assembly (cf. 6-35), a majority of the employees may require the election of one member of the board of directors and one observer, both with deputies by and amongst the employees. (2) When a company with more than 50 employees has not established a corporate assembly (cf. 6-35), a majority of the employees may require the election of up to one-third and at least two of the members of the board of directors with deputy directors, by and amongst the employees. (3) When a company has more than 200 employees and it has been agreed that the company shall not have a corporate assembly (cf second paragraph), the employees shall elect one member of the board of directors with deputy director or two observers with deputies in addition to the representation following from the preceding paragraph. (4) The King may issue regulations on the calculation of the number of employees, including the use of average figures. The King may also issue regulations on the election, including the conditions of voting rights and eligibility, the method of election and the decision of election disputes, and the termination of the office of director. The King may issue exceptions from the provisions of first, second and third paragraph Employees right to elect members of the board of directors in company groups (1)When a company belongs to a group of companies, a written agreement may be entered into between the group of companies and the majority of the employees, or between the group of companies and one or more of local unions that represents a majority of the employees in the group of companies, deciding that the employees of the group of companies for the purposes of applying 6-4 shall be considered as employed in the company. (2)When a company belongs to a group of companies, and an agreement as mentioned in the first paragraph is not entered into, the King may, following an application from the group of companies, from a majority of its employees or from one or more local unions that represents a majority of the employees in the group of companies, decide that the employees of the companies for the purposes of applying 6-4 shall be considered as employed in the company. (3)The first and second paragraphs apply similarly when a company constitutes a part of a group of enterprises that are connected though ownership interests or joint administration. (4)The King may decide that this present section shall apply to parts of a group of companies or such group of enterprises Member of the board of directors term of service (1) Members of the board of directors serve for two years. The articles of association may provide for a shorter or longer term of service, although not for more than four years. For the purpose of supplementary elections, the period of service may be made shorter. (2) The period of service commences on the date of the election except as otherwise provided. It terminates at the end of the ordinary general meeting in the year of expiry of the period of service. (3) Regardless of whether the period of service has expired, the director will remain in office until his replacement has been elected. (4) The provisions in first and second paragraph do not apply to members of the board of directors who have been elected pursuant to 6-4, cf. 6-5 above Retirement and removal before expiry of the term of service (1) A member of the board of directors may on special grounds retire before his period of service has 464